This segment amounts to $6 billion in assets and has enjoyed an impressive growth streak over the last five years of over 30% CAGR. It provides a stable revenue base, minimizing volatility. In what follows, I cover the fundamentals of AQN and explain why I currently view it as a better buy for dividend growth investors than NextEra Energy's stock.ĪQN owns and operates energy production and transmission assets in Canada, New Hampshire, California, Nevada, Arizona, Texas, Arkansas, Missouri, and Kansas, to name its largest markets.Īmong regulated utilities, the company boasts 801,000 household and business connections for electricity, gas, and water. That makes the estimated 10-year yield on cost based on today's price a much more impressive 10.4%. The company's average dividend growth rate over the last ten years has been a slightly better 10%. It has a $7.4 billion market cap, trades at 23x 2019's rather weak earnings, and offers a 4% dividend yield. Considering the average long-term compound annual growth rate of the dividend of 9%, the 10-year yield on cost (YoC) if shares were purchased at today's price would come to right around 5%.Ĭompare that to AQN. It's a $118.4 billion market cap company trading at a 28.5x price-to-earnings ratio and a 2.1% dividend yield. ( NEE), the largest utility as well as the largest owner of renewable energy assets in the United States. Many investors have heard of NextEra Energy, Inc. The company reminds me of another dividend investor favorite based in Florida. Through its 44.2% ownership of the YieldCo Atlantica Yield ( AY), it bears exposure to 1,500 megawatts ("MW") of renewable assets and 343 MW of natural gas assets across the world.
Algonquin Power & Utilities ( NYSE: AQN), headquartered in Oakville, Canada, owns a portfolio of both regulated and non-regulated utility assets across North America and Bermuda, with a heavy emphasis on renewable energy.
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